Stocks end flat ahead of FATF meeting

Stocks on Friday ended barely changed in range-bound trade as investor engagement remained tepid ahead of the FATF meeting that is seen keeping Pakistan in gray list because a number of its requirements are yet to be fulfilled, dealers said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index gained 0.16 percent or 66.98 points to close at 41,266 points, while ready market volumes decreased to 354.430 million shares, as compared to 500.098 million on Thursday. KSE-30 shares index closed just 0.1 percent or 18.10 points higher to end at 17,381.28 points level.

Salman Ahmad, head of institutional sales at Aba Ali Habib Securities, said, “The FATF announcement kept the investors at bay where political developments with another call of a political public gathering on Sunday let the curtains down”.

The market was likely to see some adjustment as following sessions would see rollover of the future holdings, where trading days would be shortened to four as on Friday the market would be closed on account of Eid-Milaad-un-Nabi, he said.

“However, the fundamentals have been strong as most of the announcements from the companies are above market expectations, which indicate economy after COVID-19 is bit on the mend,” Ahmad added.

A A Soomro, managing director KASB Securities, said, “The market has been range-bound, but sectors are thriving”.

He said the IMF talks were likely resuming, which would help pave way for Eurobond issuance, while the FATF’s appreciative language would keep investors elated.

“Cements are rejoicing the Supreme Court decision that enables banks to sell loan defaulters’ properties. Thus cylicals led the upward momentum on the weekend,” Soomro added.

Trading activity was recorded in 402 active scrips, of which 219 improved, 172 retreated, and 11 ended unchanged.

Analyst Ahsan Mehanti from Arif Habib Corporation said, “Stocks showed recovery led by selected oil, fertiliser and banking scrips on strong earnings outlook”.

Current account surplus, strong remittances, and upbeat corporate results in oil, fertilisers, and banking sectors kept the stocks afloat, Mehanti added.

Saad Rafi, head of equity sales at Al-Habib Capital Markets, said, “The market ended on a positive note in a mostly choppy session”.

He said at one stage the index was going up on the back of healthy financial result announcements, mainly from Engro, declaring handsome dividend and profit numbers.

“DG Khan Cement’s below-market-expectation earnings weighed on the market; however, buying in other cement companies, which were in good demand, helped stabilise the index,” Rafi said.

Furthermore, there has been somewhat cautious approach as decision with regard to FATF expected in the evening, with rollover next week and decision of FATF parleys to dictate market trend and the index to move accordingly, Saad Rafi added.

Sapphire Textile, up Rs56.32 to close at Rs807.32/share, and Nestle Pakistan, up Rs50 to finish at Rs6,500/share, were the top gainers, while Gatron Industries, down Rs52 to close at Rs648/share, and Hinopak Motor, losing Rs17.43 to close at Rs437.57/share, suffered most losses during the day.

Maple Leaf Cement, up Rs1.44 to end at Rs42.18/share, topped the volumes chart with 45.775 million shares, whereas DGK Cement, up Rs1.6 to end at Rs112.32/share, bottomed it with 9.108 million traded shares.